Elena Kochetkova National Research University Higher School of Economics-Saint-Petersburg/ University of Helsinki
Elena Kochetkova National Research University Higher School of Economics-Saint-Petersburg/ University of Helsinki
Elena Kochetkova National Research University Higher School of Economics-Saint-Petersburg/ University of Helsinki
Elena Kochetkova
National Research University Higher School of Economics-Saint-Petersburg/
University of Helsinki
"Finnish-Soviet trade in the 1950s-60s: interests and tools of Cold War actors"
Introduction
In the late 1950s, the managing director of Finnish company Rauma-Repola Paavo
Honkajuuri stated that Russian trade orders made it possible for us to launch a serial production
of [pulp making] machinery which before had been produced as a single-piece.1 Indeed,
following WWII, Soviet Union was an attractive export market for Finland, a capitalist country
which had unusually close trade connections with the socialist state. Soviet trade played a
remarkable role in Finnish economic growth prior to the end of the USSR in 1991. Trade with
Finland was also beneficial for the Soviet economy, as it provided advanced technologies and
techniques. For the Soviets, trade with Finland acted as a window to Western technology.2
For Finland, the Soviet Union was a large socialist and ideologically driven partner on
the other side of the Iron Curtain. For the Soviet Union, Finland was a small neighboring
capitalist state with a close relationship to Western rivals. The high-level economic organizations
in both countries tended to stress the political and cultural significance of cooperation between
capitalism and socialism. However, they provided more rhetorical pronouncements regarding
friendly cooperation and the co-existence of capitalism and socialism than descriptions of details
and practicalities.3 The Finnish-Soviet economic cooperation was, thus, influenced by political
rhetoric, but behind the macro level of state relations there was a set of interests and actions of
individuals. In practice, actors from both sides used their own tools to achieve goals such as
making profit, competing for export increases, and purchasing or selling at the most beneficial
price. Definitely, the context set by the Cold War shaped these tools and forced economic actors
to deal with political and ideological factors. Yet, as current scholarship illustrates, these factors
were not primary.
Many recent papers stress the importance of the micro level analysis, but trade practices
in the early stages of Finnish-Soviet relations in the post-war era are still a marginal topic. Pekka
1
Sutela considers methods of communication between Finnish and Soviet individuals involved in
trade activities, mostly in later periods.4 Niklas Jensen-Eriksen examines influences of the Cold
War realities on Finland and in particular a role of COCOM in Finnish external economic
politics.5 The particular specific position of Finland between East and West as well as
peculiarities of political relations and their influences on trade is examined by Tatiana
Androsova.6 Other authors, in particular Sari Autio-Sarasmo, investigate practices and channels
of scientific-technical cooperation and technology transfer from Finland to the Soviet Union.7
However, interests and tools for realizing trade and technical cooperation as employed by
individuals in the two different systems during the early years of the Cold War requires more
attention.
While touching on the macro level context, in this article I will focus on local actors in
Finland (companies and traders) and in the Soviet Union (representatives of state trade and
research organizations and specialists of enterprises) in order to understand their interests and the
business tools developed in the trade dialogue between different systems on the practical level in
the age of the Cold War. Primarily, I am interested in Finnish imports to the USSR and their
roles both for Finns and Soviets. I will examine the first period of Finnish-Soviet trade in order
to look at how these tools were developed and what interests prevailed. This analysis will
contribute to understanding the Cold War on the micro level as well as activities of various
actors cross the Iron Curtain.
This article is grounded in examples coming from the forestry industry, one of the
significant fields of Finnish-Soviet trade. Forestry industry products and equipment were among
key items in the reparations that Finland paid to the Soviet Union after the war of 1941-44.8
These reparations preceded technology transfers and trade contacts, and defined the possibilities
for Finland in terms of exporting its goods. Compared to other imports, forestry was not the
largest, but still intensive, and a number of Finnish forestry industry companies were involved in
the trade with the Soviet Union. In broad terms they specialized in a vast range of fields, from
logging to ready-made products, and records of their activities provide a rich set of examples for
the strategies used by Finnish actors in trade to the East. From the Soviet side, trade with Finland
offers examples of how state trade organizations (such as those involved into exporting and
importing) and research establishments and enterprises (such as end users of imported items and
those who manufactured products for export) conducted their affairs. My aim is not to draw a
2
comprehensive picture of the trade structures between two blocs, but to explore the role and
meaning of industrial, trade, and research organizations based on the case of forestry. Doing so
shows how trade functioned below the state leaders. In this article, I will also try to identify the
interplay of political factors and business interests at the macro and micro level.
The major sources of this article are the documents of different organizations held in
Finnish and Russian archives, many of which are examined here for the first time.9 Empirical
data are found in the correspondence of Soviet and Finnish institutions, such as letters of the
heads of the State Committee on Science and Technology of the USSR (responsible for
cooperation from the Soviet side) to Finnish enterprises and vice-versa, and letters from Finnish
producers to Soviet enterprises, among others. Other valuable sources include reports by various
actors, especially from Finnish engineers regarding their visits to Soviet research institutions and
factories, reports of Soviet engineers who visited Finnish enterprises and research
establishments, and the reports of the Finnish-Soviet Trade Chamber on exhibitions, among
others. Some conclusions can also be drawn from analyzing the protocols and minutes of
negotiations between Finnish and Soviet company management, traders, engineers, etc.,
especially negotiations of yearly and five-year trade agreements. These materials enable me to
draw a picture of the activities of different actors and institutions and their methods of
communication. In addition, I study periodical literature, including published reports of Soviet
specialists, translated professional articles, newspapers and descriptions of Western technologies,
as well as some data from oral interviews given by Finnish producers, though of slightly later
time.
In the first part of this article, I briefly investigate the meanings and images of trade at the
macro level. Then, I explore opportunities and limitations set by organizational aspects of
Finnish-Soviet trade in order to show the general context of traders` activities. In the following
parts, I examine Finnish-Soviet trade on the micro level, from exhibitions, advertising and the
specifics of the negotiation processes.
Intensive trade relations between Finland and Russia have a long history. In the
nineteenth century, when Finland was part of the Russian Empire, it delivered many products to
Russia, in particular manufactured from its forests. After Finland gained independence in 1917,
relations with the Bolshevik Russia became complicated and entailed a significant decrease in
trade. The tensions between two states, which were on divergent political paths, resulted in two
wars. As a consequence of the final conflict, Finland had to deliver industrial goods, machinery
and raw materials as part of reparation payments. Simultaneously, trade activities were
developed between the two countries. In 1950, Finland signed a five year trade agreement with
the USSR, becoming the first market economy to have long agreements with a planned economy.
After the war, Finnish forestry enterprises introduced more diverse products, such as new
types of paper, cellulose, and cardboard. From this period onward, Finnish firms were among
key suppliers of forestry machinery, raw and ready-made products for the Soviet Union which, at
the same time, was becoming more dependent on foreign products. A cursory look at the
statistics proves that compared to other European countries Finland was the leader in Soviet
imports of forest industry products and machinery in the 1950s-60s, with some interruptions. For
instance, in 1958 Finland exported paper products equal to slightly less than 12.5 thousand
Soviet rubles while Austria, the second large paper importer to the Soviet Union that year,
delivered products worth to 3.3 thousand.10 In general, in these years the volumes of Finnish
exports to the USSR were growing more much faster than to other countries.11
To a large extent, purchases from Finland served the purposes of Soviet modernization,
which was significantly based on active participation of Finnish producers. Trade activities were
closely connected with various forms of technology transfer. In particular, trade enabled
communication between engineers. This included exchanges of literature and trips by Finnish
specialists to the Soviet Union, where they helped Soviet engineers install Finnish machinery and
facilities. An example of this is the modernization of the Svetogorsky pulp and paper group of
factories which were partly renovated on the basis of supplies from Finnish companies like
Rauma-Repola and Ahlstrm. In addition, Rauma-Repola contributed to the construction of a
giant Baikal plant launched in 1966 to produce bleached pulp used in the military manufacturing.
Close trade contacts between two countries were put into political context, and the need
for good political relations was stressed at the highest level. In describing trade activities, both
Finnish and Soviet officials used ritualized wordings regarding the importance of Finnish-Soviet
4
relations for both sides. Similar rhetoric was used in speeches by Finnish officials (though,
probably not as frequently as of Soviet ones) who stressed that the border was a decisive factor
in the relationship between the two countries as well as advocating friendship and a good
neighborhood. Because of geographical proximity, the border was a useful concept that both
sides often used when explaining the meanings of trade and cooperation in fields like science,
technology, and culture. Thus, when explaining the Finnish-Soviet trade to Western partners on
negotiations with EFTA, Finnish Trade and Industry Minister Ahti Karjalainen said that it is
natural that the Finnish trade with the Soviet Union is relatively large and will remain so because
the Soviet Union is a neighboring country.12 He added that, the arrangements agreed upon
between Finland and the Soviet Union are based on their neighboring relations.13 For Finnish
political actors, the border was an explanation for close connections between a capitalist and
socialist economy and gave official justification of trade developed after the war. On the state
level, the Finnish government stressed the border as necessitating good relations. The Finnish
view of the border helped support the official rhetoric seen in Finnish-Soviet political discourse
and to some extent explain the reasons of intensive trade connections with a socialist state.
In contrast, the Soviets offered a view of the peaceful border and good neighborhood
not as a reason, but as a consequence of well developed trade that enabled both countries to
benefit.14 Soviet authorities usually stressed good relations were a consequence of wise political
leadership during the Cold War, and as evidence of peaceful co-existence. In fact, Soviet trade
was always politically more important than it probably was economically. Consequently, it was
used not only as a tool for economic improvements, but also as a tool of gaining and using
political power.15 Interestingly, on the institutional level Finland was often perceived as a
socialist state in terms of its close connections and significance for the Soviet Union. Thus,
archival documents on trade with Finland are kept in folders titled Cooperation with socialist
countries.16 For example, materials of the State Committee on Science and Technology, a
leading institution to supervise Soviet foreign scientific-technical and trade contacts with foreign
countries, are housed in collections divided between such as Western countries and Socialist
countries. Finland material is rarely kept in Western folders, probably because of bilateral
trade organization and more intensive (compared to other capitalist countries) communication
with the Soviet Union.
To a certain extent, changes in the relations between the states influenced Finnish-Soviet
trade. Historian Tatiana Androsova argued that drops in the volume of exports and imports can
be explained by deteriorating political relations when the Soviet government decreased or
detained trade goods.17 Thus, compared to 1957, the volume of Finnish imports to the Soviet
Union decreased significantly in 1958, when the Soviet government withdrew the ambassador
after a change in the Finnish parliament saw an increase of politicians hostile to the Soviet state.
In 1961, a new crisis (the so called note crisis) began after the Soviet leadership sent a
diplomatic note to Finland insisting on closer war cooperation.18 Still, the Soviet side was not
very much interested in decreasing trade volume which was beneficial in economic terms.
In addition, Finnish state actors had considerable economic interest in Eastern trade,
beyond rhetoric and despite a variable political situation. At the opening of the Finnish industrial
exhibition in Moscow in 1960, the aforementioned Karjalainen stressed that a good
neighborhood always contributes to both countries. This is definitely the Finnish opinion.19 For
Finland, this included commercial interests, in conjunction with possibilities for developing its
domestic labor markets. As Karjalainen argued, the development of Eastern trade would provide
more jobs in Finnish shipbuilding, metallurgic and timber industries and enable the growth of
the economy of our country.20 In practice, indeed, Soviet trade was of importance for actors at
all levels involved in the trade with the Soviet Union. It allowed import of products not
sufficiently produced in Finland, especially crude oil and oil products. In the late 1950s, oil
supplies constituted up to one fourth of the Soviet export to Finland, being a means of payment
for Finnish products and technologies.21 The volume of oil significantly increased due to the
opening of large oil reserves in Western Siberia. Finland also received metallurgic products and
facilities, including Soviet help in building some factories, in particular in 1961 of a metallurgic
factory in Rautaruukki.22
As historian Pekka Sutela notes, based on a vast number of interviews, Finnish traders
have always joined the official Finnish-Soviet praise of mutual benefits of bilateral trade. At
the same time, these traders knew that the role of the politicians has been overplayed in public
consciousness.23 The primary interest in cooperation for both sides, at lower hierarchical levels
was economic, not and not significantly penetrated by political concerns. Both treaties on
supplies signed by Finnish firms and Soviet export organizations, and reports and addresses
produced by Finnish trade representatives attest to interests in economic benefits and cast the
6
Soviet Union as a client and partner. For example, in his book a specialist of Rauma-Repola,
Vin Lassila described Soviet factories and Soviet engineers without ideological rhetoric or
politics. He refers to the Soviet Union as a client which purchased the products of this Finnish
company.24 Another Finnish specialist stated that Finns and Soviets never discussed the politics
in their communication.25 This attests to the fact that Finnish local actors engaged in the Soviet
trade were interested in the economic benefits of cooperation and saw the Soviet market as
increasing exports. In their turn, Soviet representatives (both from trade organizations and
enterprises) considered Finland as a source of valuable knowledge and techniques which could
help Soviet modernization. It is therefore important to examine what possibilities and constrains
the Cold War created and how Finnish and Soviet actors sought to achieve their goals in the
context of Finnish-Soviet relations.
conditions the same products could be used either for civilian or military purposes.30 The Soviet
government and producers were aware that Finland gave the Soviet Union large opportunities
for receiving not only Finnish industrial experience, but also achievements of American,
Canadian and Swedish industries since Finland has had business with them for a long time.31 In
the age of confrontation between the two blocs, a neutral Finland opened a window to the
Western economic and technological achievements inside the Iron Curtain. Indeed, Finnish
forestry industry was heavily based on Western techniques, since Finland had longstanding
contacts with American, Canadian, Swedish and other foreign companies. In other words, the
Finnish-Soviet cooperation was a means for gaining transfers of technologies from a world
relatively closed for the Soviet Union.
Many trade constrains were set not by the Cold War, but rather derived from cooperation
between countries of different technological and economic levels. Finnish-Soviet trade was
organized as a clearing trade, meaning that deals between the governments were made with no
payment in hard currency, i.e. national money did not cross the state borders.32 In this exchange
of goods, the overall costs of Finnish products were to correspond to the cost of Soviet ones
evaluated in a non-convertible currency. Such kinds of payments were fulfilled by the Bank of
Finland and the Soviet Bank for Foreign Trade (Vneshtorgbank). Trade items were defined by
five-year trade agreements, and additional treaties were signed every year to specify the items
based on current situation and the needs of each country.
On the one hand, this stance simplified organizational challenges by creating a sort of
stability, defined by trade agreements that were worked out on the governmental level.
On the other hand, clearing rules put limits on possible benefits for the Finnish side. Both at the
state and companies` level, this meant that the volume of Finnish-Soviet trade depended on
Finnish possibilities to accept Russian products.33 As the head of the trade office of the
Ministry of Social Affairs Osmo Kopola said, the scarcity of the Soviet import makes it
impossible to find enough consumed products for Finland,34 These specific possibilities of
Soviet exports and a dearth of products were serious obstacles, which effectively limited the
growth of Finnish-Soviet trade.35
Indeed, the variety of Soviet products offered for clearing import to Finland was not very
large, and the Soviet Union usually paid for technologies and advanced foreign equipment and
machinery with agricultural and raw products.36 In the first decade of post-war trade, the Soviet
8
Union offered large quantities of agricultural products for export to Finland. In particular, it was
Soviet grain which replaced German supplies right after the war and, thus, met the Finnish
needs.37 But by 1954, several Finnish organizations were willing to reduce by half the imports of
Soviet wheat. Before that the Soviet share in grain imports was quite formidable compared to
others: it was as three times more than from the USA.38 In the late 1950s, grain lost its position
as the main item of export and was replaced by oil. At the same time, the Finns aimed to arrange
imports of scarce and critical raw materials such as charcoal, silver, and magnesium metals,
among others. The small Finnish market could not consume large amounts of agricultural
products, while the Soviet Union aimed to receive a great deal of machinery and manufactured
products in exchange for raw materials. Negotiations not lead to outcomes desired by the Finnish
side, however, as Finland wanted to increase imports of Soviet cars and petrol.39 As a result,
Finnish authorities tried to find markets for the re-export of Soviet imports.40 This problem was
likely well understood in the Soviet Union, as in the late 1950s it agreed on paying for part of
Finnish supplies in hard currency, or 40 million rubles every year.41
In the forestry industry sector, offers of producers were collected by cartels which
represented the sector in negotiations. From the Soviet side, trade was supervised by the Ministry
of Foreign Trade through state foreign trade associations specialized in different fields. In the
forestry industry these were Mashinoimport to purchase machinery and equipment,
Tekhnopromimport for imports of facilities for pulp industry, and others. Despite the high
meaning of trade at the inter-governmental level, this middle level played a crucial role in
practical arrangements. Thus, for instance, government-level trade agreements often simply
codified agreements already reached on the company level. Prices, in particular, were agreed at
company level.42 Most Finnish companies had special offices on trade with the Soviet Union,
which created different tools and mechanisms in their dialogue with the big partner.43 Not only
was their communication with representatives of trade associations crucial, but also their
contacts with heads of Soviet enterprises and engineers. Soviet engineers made recommendations
for managing organizations which, in their turn, communicated with associations. The micro
level was, thus, a basic stage in trade, and contacts between Finnish producers and Soviet
consumers were crucial in the trade dialogue.
10
Exhibitions
One important means of influencing on exports by making personal contacts with Soviet
actors were exhibitions. Despite the Cold War, starting from 1956 the number of foreign
exhibitions organized in the Soviet Union increased. To a large extent this was a result of
liberalization of Khrushchev`s time and a turn to more intensive cooperation with Western
countries in science and technology.
Although much has been written about foreign exhibitions in the Soviet Union and their
ideological and cultural meanings, economic meanings of industrial trade shows require more
explanation.44 Exhibitions were an arena not only for ideological battles or cultural transfers, but
also for the possibility of realizing economic aims despite the Cold War. As the historian of
technology Karen Freeze wrote in her paper on Czechoslovakian technologies, innovative
technology, usually displayed at trade fairs, world`s fairs and other special venues, served as an
ambassador to the West.45 One meaning of exhibitions was as a place to advertise and promote
production as well as establish economic ties with potential consumers. Exhibitions were a
playground for communications of those who displayed (Finnish producers) and those who
consumed (Soviet trade and managing organizations and final consumers or factories and
engineers).
The first Finnish industrial exhibition was held in Moscow in 1946 after the FinnishSoviet Trade Chamber was founded. The aim of this organization was to develop economic
connections through exhibition activities, meetings and seminars as well as issuing informational
materials. Between the 1950s and 1960s, several large general and specialized or thematic
industrial exhibitions of Finland were organized in Moscow. The largest one, held in 1960,
displayed products from ninety six participating Finnish companies, a large part of which
included the forestry sector.46 The Finnish Minister of Trade and Industry Ahti Karjalainen
opened the exhibition by saying explicitly about its economic purpose and pointing out that
Finland aimed to offer goods, represent Finnish export in the Soviet Union, as well as to show
what Finland could sell. Apart some official rhetoric, he stated that exhibitions should be a shop
window where you can see and choose goods you like.47 This was addressed both to citizens,
local producers and officials engaged into export activities.
10
11
As usual, exhibitions entailed diverse activities related to trade. They were an important
ground for establishing contacts on the local level, in particular at meetings with exporters and
specialists, lectures and discussions on topics related to productions in Finland and the Western
world in general. This enabled Finnish producers to communicate with the Soviets responsible
for factories and research institutions, who were the end users of Finnish products. Although
consumers could not make direct decisions on purchases, they could influence trade by making
recommendations to the State Committee on Science and Technology which then made
centralized suggestions for export and import. Such recommendations included technology to
purchase, places to visit in Finland to learn about new technologies, and individuals to invite to
Soviet research institutions for presentations.
Although on the state level bilateral trade with the Soviet Union provided a certain degree
of stability, Finnish companies perceived the Soviet Union as a market for which they had to
compete among each other and with foreign firms.48 Since bilateral trade put limits on the
quantity of imported goods and Finnish companies were to supply corresponding quantity of
export products, firms aimed to develop connections with the Soviets.
The politics of Soviet leadership in the mid-1950s-60s contributed to this competition for
the Soviet market.49 Because of liberalization under Khrushchev, as well as increasing contacts
with the capitalist world, foreign exhibitions became significant events in the life of Soviet
citizens (especially in large cities like Moscow) as well as possibilities for the Soviet economy
and modernization open for technology transfer. In Khrushchev`s period, the number of foreign
exhibitions held in the Soviet Union increased significantly compared to the previous decades.
Thus, between 1946 and 1961 there were 132 exhibitions held in the USSR of which 103 were
organized between 1958 and 1961.50
Starting from the mid-1950s, some Finnish newspapers published articles expressing
anxiety and encouraged Finnish producers to develop more active presence at Soviet exhibitions.
Thus, in 1955 one Finnish newspaper proposed that Sweden was willing to significantly increase
its exports to the Soviet Union, in particular using exhibitions as a tool for opening the Soviet
market to Swedish industrial production. In addition, the article expressed its strong concern
since the Soviet Union had an interest in Swedish industrial products.51 Another example can be
found in an untitled document from the Finnish-Soviet Trade Chamber, regarding an exhibition
held in 1958, which stated that since other countries that held their exhibitions before are
11
12
interested again in further exhibiting as well as aim to expand their presence in the Soviet
market, the Finnish exhibition should gain more meaning and be better prepared in order to
compete with others.52
Exhibitions, and the first class quality of Finnish products, had an impact on Soviet
specialists and ordinary citizens who visited them. They revealed a need for better consumer
goods, a fact made clear in Soviet letters, comments, and feedback given about exhibitions. They
mostly addressed to Finnish furniture, notebooks and other consumer goods (not exhibited so
much as machinery and equipment). In the National Archive of Finland I found a letter written
by a Soviet woman had visited the Finnish exhibition in 1960 twice. Apart from some praising
comments on the exhibition and Finland in general (and this opinion about the country and
Finnish people was definitely formed by the visit) on behalf of the all Soviet people she stated
that we, the Soviet people, like the Finns, are interested in friendship, peace and increase of
trade and cultural contacts.53 She also expressed her interest in Finnish products, hoping that the
Soviet Union would purchase them in the future.54 Exhibitions were a useful tool for promoting
products even among citizens, who could not make any decision on supplies, but could purchase
some products at the exhibition. Some visitors said about this, also noting that the higher quality
of Finnish production derived from market economy which allowed competition between
producers.55
At the same time, Soviet engineers were among the visitors, and some research
institutions and factories organized group visits to exhibitions. They were professionals who
could compare Soviet and Finnish products and implicitly influence Soviet imports. Thus,
exhibitions were important both for exposing Soviets to new consumer goods and for presenting
the possibilities of Finnish industry.
Exhibition activities were closely connected to advertising the products purchased by the
Soviet Union. The Soviet system did not encourage explicit commercials in the country, but
allowed some advertizing of foreign exhibited goods. In addition, we can find other forms of
12
13
proposed by the Soviet government, and promoted by the Soviet-Finnish Trade Chamber.
Traders could use not only information on products but applied slogans and attractive titles,
sometimes referring to foreign quality. For instance, one of such advertisements prepared by
Converta, the association of Finnish paper and cardboard producers57, advertised paper packages
that could be very suitable for different uses. The slogan used in their advertisement brochure for
the exhibition in 1960 said that your products in our boxes will feel like a nut in a nutshell.58
Advertisements also referred to the volume of trade with the Soviet Union as well as to the
foreign partners. Usually, they contained attractive pictures, appealing to topical issues like
cosmos and planets, which were very popular in the USSR after the countrys space successes.
Another advertisement, however offered by a Finnish cloths producer pictured a man sitting in a
pullover, saying that such pullovers are exported even in the USA.59 Here we see two tools
used in addressing Soviet consumers. The first one is using attractive slogans and pictures, the
means of capitalist commercials. The second one is referring to reliability of companies and their
trade connections with the Soviet Union and Western states. The advertisements were distributed
among Soviet research institutions and industrial organizations as a guide to visiting exhibitions
and learning more about Finnish production. Advertisements were usually printed in special
brochures and specialized journals and newspapers such as Ekonomicheskaya gazeta
(Economic newspaper), Lesnaia promyshlennost` (Forestry Industry), Sovetskaya torgovlia
(Soviet Trade), among others. These periodicals also published news on exhibitions and
overviews of separate exhibits and products.
Interestingly, the Soviets also prepared advertisements for their products shown at
exhibitions abroad. For instance, an industrial exhibition in 1959 held in Helsinki was
accompanied brochures and advertisements issued through different channels. These materials
were expected not to show the ideological superiority of the Soviet Union, as was stressed in the
Soviet exhibition in New York in 1959. Activities in Finland seemed to meet the expectation of
Finnish consumers and were of very practical and economic nature. Thus, Soviet trade
13
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representatives in Helsinki translated of short films for TV, emphasizing that the films should
contain no hint on political propaganda and indicate that the films were sponsored by Soviet
exhibition in Helsinki.60 Also, to Finnish visitors in the Soviet Union, the Soviets advertised a
wide range of products and services, ranging from Aeroflot flights to vodka and fish.61 These
materials were published by the Finnish-Soviet Trade Chamber in special leaflets and journals.
They contained both visual advertisements and short articles on specific products, such as cars,
describing the volume of cars or cameras sold abroad.
The Finnish-Soviet Trade Chamber also organized lectures, master classes and
demonstrations of products. At the fourth Finnish exhibition in 1960s alone, there were 25
presentations hosted by Finnish experts on timber processing, the technology of making pulp and
paper, among other topics. About six thousand Soviet specialists from different institutions and
enterprises visited these lectures.62 In 1964, several Finnish forestry companies, such as EnsoGutzeit, Paperituote, Tampella and others, took part in a lecture series in Moscow at the State
Committee on Forestry, Pulp and Paper and Wood Processing Industry and Forestry Planning
Committee (Gosleskomitet pri Gosplane SSSR). The programme included lectures on the
technology of packaging in Europe in the last decade, practical instructions by Finnish experts on
designing storage containers, as well as one-on-one consultations on individual technologies
presented in lectures.63 These consultations were a method of direct contact between Finnish and
Soviet actors and helped promote Finnish products and technologies, especially machines and
equipment. Exhibitions, thus, helped enable Finnish traders overcome the barriers created by
bilateral trade organized on the highest level. As representatives of the Central Union of Finnish
Woodworking Industry stressed to the purchase department of the Union in 1958, after visiting
the Soviet Union overcoming bureaucratic barriers and contacting enterprises directly would
give the purchaser a possibility to examine the techniques in practice as well as learn more about
how it was produced.64
Another possibility for promoting Finnish products was communication between Finnish
traders and Soviet producers and specialists during business trips made by Finns to Soviet
factories and research institutions as well as visits by Soviet engineers to Finland. These trips
were organized as part of trade and scientific-technical cooperation, and these forms of
cooperation were usually connected to each other. Although the number of such trips was not
large, they were important in terms of opening up trade with Soviet consumers, otherwise
14
15
relatively closed by the Iron Curtain. Representatives of Finnish companies traveled to Soviet
industries and factories to meet with chief engineers and officials of Soviet trade organizations.
They discussed what techniques and raw materials were required, and what products Soviet
enterprises did not produce sufficiently, among other questions. Thus, in 1961 a group of
delegates from three Finnish companies Finpap, Converta and Enso-Gutzeit, all members of
Finnish Union of Paper Industry visited several Soviet paper plants. A large part of the trade
trip was devoted to creating further contacts with local administrations and leading staff in order
to spread information about the quality of our paper and other products, among other things.65
Their programme included meetings with planning departments of factories which were
responsible for providing information to central planning institutions.
On the one hand, the outcome of these trips could be found in promotion of new
technology and equipment ready for export, which was a way of influencing based on consumer
request. Finnish delegates demonstrated their products, showed their quality, and explained
possibilities of imports.66 On the other hand, Soviet specialists with whom Finnish traders
communicated could offer their factories for visits, although the final decision was always made
by the Soviet-Finnish scientific-technical commission. Reports prepared by Finnish visitors
treated Soviet factories as consumers, noting how they exploited Finnish techniques already in
use, their plans for modernization, as well as which equipment, technical details or materials
these factories required. Some reports argued that these trips opened up new perspectives on
what Soviet enterprises actually required. These trips broke up some of the informational
isolation created by the Iron Curtain, in particular increasing Finnish knowledge about how
Soviet production and consumption was organized. For example, in 1961 a delegation of
representatives of Finnish Union of Paper Making Plants got to know about how the new
organization of Soviet industries functioned after the creation of large administrative units
(sovnarkhozy). In particular, they noticed that these administrations had more power than they
imagined before.67 Some reports illustrate that meetings revealed other things hardly accessible
without direct contact. Thus, in his report to the Soviet Union in 1957 Ilkka Tapio told that the
vice chair of Eksportles, the organization responsible for exporting timber, that there was such a
lack of products in the Soviet Union that it could purchase everything that Finland manufactured.
However, he added that no one in the leadership recognized that and Finnish delegates should
15
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not rely too much on what they saw. In other words, the lack of products they observed did not
mean that the Soviet leadership would consider that in their imports.68
Soviet engineers and officials who visited Finnish factories were another target audience
for advertisement. During their visits they received advertisements and information on the
companies they travelled to. After their trips, they had to submit these materials to their
institutions and the State Committee on Science and Technology, as well as prepare reports,
which were often long and brimming with technical details. An important part of the reports was
a list of recommendations, which usually included a section on the need to purchase equipment.
This was sometimes negatively perceived by Soviet officials who aimed not only to buy foreign
products, but also build own machinery on the basis of sample techniques and transferred
technologies. For instance, representatives of the Soviet Ministry of Forestry complained that
instead of describing technologies, specialists just recommended to purchase equipment for
industrial use.69 At the same time, Soviet specialists often brought advertising brochures and
other materials which were used as a source of information about Finnish equipment available
for import.70 Finnish trade, thus, opened a window to highly developed technologies which in
comparison to much Soviet manufacturing were seen as much better and attested to a high level
of Western development.71
Trips and exhibitions, thus, were a way of communication and negotiation between
Finnish traders and Soviet directors and specialists who could influence the decisions of Soviet
trade organizations. Direct negotiating happened in different forms: during the visits of traders
and specialists, at exhibitions, and while discussing annual trade treaties. As it was said above,
the actual negotiating was often fulfilled on the micro level between the Finnish traders and
Soviet consumers. Among other aims of business trips made by Finnish traders to Soviet
factories, negotiating the possible supplies and the quality of forestry products and machinery
was important.
While the visits within the sphere of scientific-technical cooperation implied that
delegates would examine Soviet factories and research institutions, in some cases they opened up
unexpected possibilities. Thus, in 1957, Finnish delegate Ilkka Tapio visited several Soviet
16
17
plants in different cities. While in Arkhangelsk he heard from his Russian guide that the Ministry
of Chemical Industry asked Eksportles to seek sources of viscose pulp to purchase. Some days
later, Tapio managed to negotiate a meeting with the vice-head of the Ministry of Chemistry
Novikov to discuss possible deliveries. Novikov argued that Finnish companies offered their
items at a higher price than countries like Sweden and Canada, who offered same quality at a
lower price. Tapio invoked the border and a long tradition of beneficial trade. Here we see him
appealing to the idea of the border, often stressed by officials as an important factor in trade. The
outcome of these negotiations is not clear, but it probably failed because the sides did not agree
on a price.72 Still, this story illustrates that some questions were negotiated rather informally.
In most cases, however, the Finnish side was informed about Soviet plans or tried to
follow Soviet needs. The Archive of the Finnish Foreign Ministry contains many minutes of the
Finnish-Soviet trade negotiation meetings at the highest level. Among the materials attached to
the minutes I found a copy of an article published in the Soviet newspaper Pravda in 1956. The
article was written by the head of the Soviet Ministry of Forestry Georgy Orlov and dealt with
challenges the industry faced, in particular, on equipment the field required. The techniques and
repair parts listed in the article were underlined with a pen, and this information was probably
used during the negotiating as items offered for purchases.73
Finnish import to the Soviet Union implied negotiating on a number of principal issues
derived from different approaches and requirements of production. Standards were a critical
aspect in the process of negotiations, primarily because they were of great importance in all
spheres of Soviet production. In 1940, the decree of the Soviet Supreme Court resolved that
producing bad quality goods was equal to the anti-state crime or sabotage (vreditel`stvo).
Consequently, this might entail restraint to prison for up to eight years.74 Despite the post-Stalin
period of liberalization, standardization remained very strict. If one looks at the Even small parts
or pieces of equipment were subject to detailed and thorough requirements, which can be seen in
special published volumes of standards In addition to the a special All-Union Research Institute
of Metrology, there were laboratories and committees on standardization in many industrial
research organizations.
In Finland there were some general standards, which were not compulsory, and firms
could choose if to follow them or not. There was a private organization on standards or the
Finnish Standardization Union, although many Finnish producers used their own standards. As a
17
18
result, Finnish and Soviet standards and standardization procedures are very different, and this
created a number of difficulties in the import of flawed of Finnish imports to the Soviet Union.75
The Soviet state standard or GOST was almost a law, and the Soviet Union was often
discontent with the quality of Finnish products, in particular timber and wood.76 In order to
meet the Soviet requirements Finnish producers were to manufacture goods specifically oriented
to the Soviet market. For instance, traders were to cut trees which met the GOST requirements.
In order to overcome differences in standards, a special group on standardization in the SovietFinnish commission on scientific-technical cooperation was created to discuss these issues and
work on controversial questions.77
Language was a significant obstacle in communications between sides on the micro level.
As a rule, Soviet delegates resorted to interpreters and translators, though not always
professionals in the forestry industry. In trade practicalities, the Soviet side required that
equipment come with instructions in Russian. Thus, when ordering machinery, Soviet
organizations asked about delivering tablets and signs in Russian.78 In due course, Finnish
traders began to use the Russian language as a means of communications with Soviet partners.79
Conclusions
Broad-ranging Finnish imports were of importance for the Soviet Union on several levels
of meaning. First, the Soviet leadership expected them to help in the program of modernization
launched by the Soviet leader Nikita Khrushchev in the mid-to-late 1950s. Purchased machinery
and hardware were necessary technologies for in replacing outdated Soviet equipment and for
updating production. At the same time, some Finnish firms provided Soviet enterprises and
research organizations with contemporary technologies and materials used in the military sphere.
The Soviet Union transferred a wide range of materials produced by forestry industries,
including the bleached cellulose used for production of gun powder, viscose cellulose important
for cloth industry, furniture, etc. Second, being a subject of modernization, the Soviet forestry
industry did not meet set tasks of plan fulfillment, and to some extent Finnish raw materials and
other goods filled in for a lack of products demanded by domestic consumption.
18
19
For Finland, the period of 1950s-60s meant further development of trade connections
with the Soviet Union launched after the WWII during the Finnish payment of reparations. These
years developed bilateral trade connections, however, not presenting significant structural
changes. Two neighboring countries represented different blocs of the Cold War and different
industries and trade was organized with a particular control of the higher level, but many aspects
were negotiated at the micro level. Almost all the essential negotiating and advertizing happened
on the local level between Finnish traders and Soviet engineers, heads of factories and research
boards. Looking at this communication opens up a mass of contacts despite the Iron Curtain.
The micro level evidences on the importance of economic interests. During the 1950s-60s
Finnish traders used a number of tools in fulfilling economic aims enabled by Khrushchev`s
liberalization. They meant active participation in exhibitions, search for direct negotiations with
Soviet end users during business and scientific-technical trips despite the Cold War and
ideological differences. Finland was willing not only to defend its economic independency, but
to gain as many benefits as possible. Advertizing, searching for direct contacts, and using the
Russian language were among the tools used to promote Finnish products and maintain exports
to the Soviet Union. Although the political situation influenced trade, for example by causing
decreases in trade volume during when relationships between the countries deteriorated, on the
institutional level trade was not perceived through a political prism. Indeed, Finnish traders saw
the Soviet Union as a business partner and a market for which they had to compete with other
countries. Interestingly, Soviet actors expressed the same lack of ideological drive and interest in
economic cooperation.
19
20
There is a lot of evidence on that the Soviet government purchased foreign techniques and
technologies what proves the permeability of the Iron Curtain. See more in Anthony Sutton,
Western Technology and Soviet Economic Development: 19171930 (Stanford, 1968); Sari
Autio-Sarasmo and Katalin Miklssy, Introduction: The Cold War From a New Perspective in
Sari Autio-Sarasmo and Katalin Miklssy, eds., Reassessing Cold War Europe (London-New
York, 2011), pp. 1-15, among others.
3
mira i dryzhby,Mezhdunarodnaya zhizn` (Moscow), No 10, 1955, pp. 47-48; T. Barten`ev and
Yri Komissarov, SSSR Finliandia: orientiry sotrudnichestva (Moscow, 1978); Evgeni
Ambartsumov, Sovetsko-finliandskie otnosheniya otnosheniya mira i dryzhby,
Mezhdunarodnaya zhizn` (Moscow), No 10, 1955, pp. 47-48.
4
Pekka Sutela, Trading with the Soviet Union (Helsinki, 2014); Pekka Sutela, Finnish Trade
with the USSR: Why Was it Different? BOFIT Online, No. 7 (2005). See also Kari Mttl, ed.,
Finnish-Soviet Economic Relations (London: McMillan Press, 1983).
5
Niklas Jensen-Eriksen, CoCom and Neutrality: Western Export Control Policies, Finland and
the Cold War, 1949 1958, in Sari Autio-Sarasmo and Katalin Miklssy, eds., Reassessing
Cold War Europe (London-New York, 2011), p. 52; Niklas Jensen-Eriksen, Just Rhetoric?
The United Kingdom and the Question of Western Economic Aid to Finland, 1950-1962, in Jari
Eloranta ans Jari Ojala, eds., East-West Trade and the Cold War, (Jyvskyl, 2005), pp. 94-111.
20
21
Cold War Europe, in Sari Autio-Sarasmo and Katalin Miklssy, eds., Reassessing Cold War
Europe (London-New York, 2011), p. 134; Tatiana Androsova, Finliandia v planakh SSSR
kontsa 1940-h serediny 1950-h gg. Politiko-istoricheskii aspect, Otechestvennaya istoriya,
No. 6 (1999), p. 47.
7
Sari Autio-Sarasmo, Iron Curtain: From Stage to Cold War, European History Quarterly,
Vol. 41, No. 4 (2011), pp. 657-664; Sari Autio-Saramo, Khrushchev and the Challenge of
Technological Progress, in Jeremy Smith and Melanie Ilic, eds., Khrushchev in the Kremlin,
(London-New York, 2011), pp. 133-149.
8
Sakari Heikkinen, Paper for the World: The Finnish Paper Mills` Association Finnpap, 1918-
1996 (Helsinki: Otava, 2000); Hannu Rautkallio, ed., Suomen sotakorvaukset 1944-1952:
Mahdottomasta tuli mahdollinen (Keuruu, 2014).
9
The Finnish case is analyzed on the basis of materials of Finnish forestry companies located in
the Finnish Business Archive in Mikkeli. They are reports made by representatives of different
logging, timber, cellulose and paper firms on their trips to Soviet enterprises which were
consumers of Finnish products. Also correspondence between Finnish firms and Soviet import
organizations is used in this article in order to shed light on the Finnish approach to the Soviet
trade. Other sources include documents on organization of Finnish exhibitions located in the
Finnish National Archive.
10
Vneshnya torgovlya Soiuza SSR za 1961 g. (Moscow, 1962), p. 62; Vneshnya torgovlya Soiuza
Ibid., p. 85.
Alexander Rupasov and Andrei Chistikov, Obraz Finliandii v sovetskoi presse
16
21
22
17
See more in Osmo Jussila, Suomen poliittinen historia, 1809-2009, (Helsinki, 2009).
Kauppa- ja teollisuusministeri Karjalaisen avauspuhe Suomen IV teollisuusnyttelyss
Vienti, 1961 1965, in Ulkoasian ministerin arkisto. Signum 58. Ulkomaan kauppa ja
Sutela, P. Finland`s Foreign Trade: What Do Interviews Tell?// Gaps in the Iron Curtain:
Economic Relations Between Neutral and Socialist Countries in Cold War Europe. Ed. By G.
Enderle-Burcel et al. Krakow, 2009. P. 82.
24
oy, 1983).
25
26
27
Frank Cain provides a deep investigation of conflicts between the USA and Britain on the
question about embargo. See more in Frank Cain, Economic Statecraft during the Cold War:
European Responses to the Soviet Union Trade Embargo (Oxon: Routledge, 2007), pp. 5-6.
28
Alan Dobson, From Instrumental to Expressive: The Changing Goal of the US Cold War
Strategic Embargo,
Journal of Cold War Studies, Vol. 12, No. 1 (2010), p. 109.
29
22
23
31
Jari Laurila, Finnish-Soviet Clearing Trade and Payment System: History and Lessons,
ELKA.
Osmo Kopolan kirje, 2 December 1952, in Ulkoasian ministerin arkisto. Signum 58.
Niklas Jensen-Eriksen, CoCom and Neutrality: Western Export Control Policies, Finland and
the Cold War, 1949 1958, in Sari Autio-Sarasmo and Katalin Miklssy, eds., Reassessing
Cold War Europe (London-New York, 2011), p. 60.
36
Brenton Barr and Kathleen Braden, The Disappearing Russian Forest: A Dilemma in
Suomen
ja
Neuvostoliiton
vlinen
tavaranvaihto
vuonna
1954,
in
Osmo Kopolan kirje, 2 December 1952, in Ulkoasian ministeri;n arkisto. Signum 58.
Exhibition in Moscow, 1959, Kritika: Explorations in Russian and Eurasian History, Vol. 9,
No. 4 (2008), pp. 855-904, among others.
23
24
45
December 1954 when the Soviets claimed suddenly that they would not purchase Finnish
wooden houses, although in February these items were put into a five year trade treaty.
49
Kendall Bailes stressed that examined transfers primarily from the USA before the WWII
saying that the Soviet government comprehended competitive nature of capitalism and played
with capitalist firms in their competition with each other. See Kendall Bailes, The American
Connection Ideology and the Transfer of American Technologies to the Soviet Union,
Comparative Studies in Society and History, Vol. 23, No. 3 (1981), p. 434.
50
Otchet otdela inostrannykh vystavok SSSR o rabote za 1946-1963, in RGAE, Fond 638,
Ibidem.
55
Converta was a significant player in the Finnish Eastern trade. Its share in the whole
25
59
Ibid., p. 51.
60
Otchet otdela inostrannykh vystavok SSSR o rabote za 1946-1963 gg., in RGAE, Fond
tuote-esittelyt STLT:ssa.
64
Nils J. Lindbergs rapport ver fabriksbesken i USSR i samband med resan, 9-23 June 1961,
Suomen
69
Obsuzhdenie otcheta, 1955 g., in RGAE, Fond 7637, Opis` 1, Delo 3256, List 28.
70
At the same time, advertisement opened a way for some non-economic influences to the Soviet
Union. I have not managed to find evidence of such influences via communication of Finnish
and Soviet representatives in the Soviet Union, but there are some data on the impacts on Soviet
25
26
delegates in Finland. In particular, technical reports made by Soviet specialists who travelled to
Finnish factories within scientific-technical cooperation indicate that they reflected on
differences in living standards and conditions of work.
72
73
75
sopimuksia SNTL:oon.
79
26